- Demand for consulting firms has been down in key markets like the US and UK.
- However, the advisory business is booming in Gulf states thanks to national development projects.
- Working on major national projects is giving consultants “unique” influence in the region, experts told BI.
Recent years have been tough for the consulting business. Growth has plummeted in some key markets, and the challenging economic climate has led to layoffs and restructuring at major firms. But one region is proving to be a consulting bright spot.
International consultancies are finding success in the Gulf Cooperation Council, or GCC — a political and economic bloc that includes Saudi Arabia, Qatar, United Arab Emirates, Bahrain, Kuwait, and Oman.
According to Source Global, a UK-based research firm that tracks the consulting industry, the GCC consulting market grew 13.2% in 2023.
Source Global’s research found that in the more mature US and British markets, growth in 2023 slowed to 5.2% and 4.7%, respectively. In previous years, growth in both countries had been in double digits.
Dane Albertelli, a senior analyst at Source Global, told Business Insider that the scale of growth in the GCC advisory market is “unprecedented” and that it has become “the place for opportunity and the place where these companies can make a lot of money.”
Albertelli said that data for 2024 has yet to be finalized but that the GCC market was expected to have accelerated by more than 15%.
A ‘cascade’ of opportunities
Opportunities for consultants in the GCC started with the UAE roughly 20 years ago, when its government poured resources into plans to diversify its economy away from oil.
Heavy investment in tourism, aviation, real estate, and financial services led to the need for planning and technical expertise. Consulting firms started to pour money and resources into meeting the needs of the Emirati government, and “it’s just been a cascade from there,” Albertelli said.
The scale of Western consulting firms’ presence in Gulf nations is apparent in the volume of offices they have in the region. All of the Big Four — Deloitte, PwC, EY, and KPMG — have 10 or more offices in GCC countries, while McKinsey has eight, BCG has six, and Accenture has four. The UAE is a particular hot spot, with Deloitte having nine offices in the country.
Saudi Arabia has been leading the drive in recent years with its Vision 2030 strategy, a $1 trillion project to reduce reliance on oil revenues and boost the country’s standing on the global stage.
The centerpiece of Vision 2030 is Neom, an ambitious megacity and tourism hot spot being built in the country’s northern deserts. But Saudi Arabia is also planning to construct a whole new district in Riyadh, preparing to host the 2029 Asian Winter Games and the 2034 FIFA World Cup, and aiming to become a “national champion” in AI.
Dubai is now a tourism and expat hot spot, and the UAE’s economy is booming. But the drive for growth and the need for consultants hasn’t stopped — the current push is toward healthcare innovation with the aim of becoming a medical tourism hub.
Similar tourism, sport, technology, and infrastructure initiatives are underway in Bahrain, Kuwait, Qatar, and Oman.
“That naturally translates into an awful lot of advisory work,” Albertelli said. International consultants are being called in to design and implement projects ranging from transportation networks and city construction to education reform and public sector tech systems.
Such projects have not been without controversy. Saudi Arabia has been accused of human rights abuses against local tribespeople living close to the site of Neom, while hundreds of migrant workers were acknowledged to have died in Qatar in the lead-up to the 2022 World Cup.
Albertelli said that while they spend to diversify away from reliance on petrochemical dollars, the Gulf nations’ backlog of oil funds has ensured that the advisory sector avoids the macroeconomic tension that has hit the European and US advisory markets.
Barring any massive geopolitical tension, opportunities aren’t going anywhere, Albertelli said. He expects the rate of growth to continue for several years and says the main change to the market will be that, as infrastructure gets built, the work will shift from strategy to operations advice.
From the pull factor of little to no income tax to the recent opening up of society, the region has plenty to attract consultants besides a steady stream of projects.
“If you don’t mind a bit of sun, it’s probably the best place to go for your career,” Albertelli said.
A unique market
The GCC consulting market is unique in that most firms’ clients are national governments rather than private companies, giving international firms a significant role in shaping the public sector.
“The degree of access and influence that consultancies have over policymaking is far more extensive than what you see in most other regions,” Dawud Ansari, President of the Majan Council, an Omani think tank focused on development in the Gulf region, told BI. “They don’t just refine policies or draft reports — they design entire national visions and, in some cases, effectively take over the steering wheel of major policy initiatives.”
“Most Gulf states have a limited number of national think tanks and independent expertise, meaning that when a decision needs to be made, the instinct is usually to bring in an external, mostly foreign, consultant,” al-Ansari told BI.
“They come from a completely different cultural and institutional background, which inevitably affects how they operate and how aligned their recommendations are with local realities.”
Al-Ansari said that the continued reliance on external expertise for policymaking could erode public trust and restrict nationals from developing career paths in public policy.
As the market continues to grow, a rising number of local boutique advisory firms are being created. The Saudi government’s “Saudization” policy — which enforces a quota system on high-value industries — is also resulting in more nationals entering the offices of international consultancies.
Albertelli told BI that most Gulf states are focused on the outcomes and care about the brand rather than the nationality of consultants.
“All the big countries in the GCC want the best talent and they’re willing to spend no matter where it’s from. Obviously, these are all big Western companies, but I think they realize that, particularly with the Big Four, they’re massive international firms,” he said.
Have a tip? Contact this reporter via email at pthompson@businessinsider.com or Signal at Polly_Thompson.89. Use a personal email address and a nonwork device; here’s our guide to sharing information securely.
Read the full article here
